The Securities and Exchange Commission ("Commission") announced today that Judge Marilyn Hall Patel of the Northern District of California has granted the Commission's contempt application against defendant Terence M. Coxon. Coxon is a founder and the former president of the Permanent Portfolio Family of Funds, a mutual fund group based in Northern California. He is also a general and limited partner of World Money Managers, the former investment advisory firm to the Permanent Portfolio.

Previously, in August 2003, the Commission determined that Coxon and World Money Managers had violated their fiduciary duties to the Permanent Portfolio and had violated the antifraud provisions of the federal securities laws. The Commission ordered Coxon and World Money Managers to pay over $1.5 million in disgorgement and prejudgment interest. Following their failure to pay those amounts, the Commission filed a district court action seeking enforcement of the Commission's order and presented evidence to Judge Patel during a one-day bench trial.

In her May 31, 2005 order, Judge Patel found that the Commission had established Coxon's failure to pay the disgorgement and interest amounts. Judge Patel also determined that Coxon had the ability to pay some of that amount and was therefore in civil contempt. Judge Patel ordered Coxon to pay $200,000 to the Court within 21 days and to pay a sum equal to 78.125% of the net equity in the value of a house in the Fountaingrove area of Santa Rosa, California (calculated by subtracting the principal amount of the first deed of trust from the current market value of the house) to the Court within 180 days. Unless those payments are made, the Court ordered Coxon incarcerated pending payment or a showing of good cause for failure to make payment.

The Commission has withdrawn, without prejudice, its contempt application against World Money Managers pending certain stipulations with the Permanent Portfolio.